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It said more company voluntary arrangements (CVA) are likely to hit mid-market chains.

High street companies Byron burger, Jamie’s Italian and Prezzo have all embarked on CVAs since the start of 2018, allowing them to close loss-making stores and secure rent discounts.

The stark warning from KPMG comes as the owner of Tex-Mex themed restaurant chain Chiquito announced in March plans to sell off some of its prime sites while “exploring options” for other restaurants in its estate following poor trading.

(Image: Paul Stevens)

The Restaurant Group, which also owns Garfunkel’s, Brunning and Price, Coast to Coast, Joe’s Kitchen and Frankie & Benny's, blamed the so-called “casual dining crunch” for its poor results.

The company told the Plymouth Herald times were so hard it was actually open to offers for its flagship two-floor Chiquito outlet in London’s tourist hotspot Leicester Square.

Higher staff costs, rising business rates and falling consumer confidence, as well as market saturation, have been blamed for the number of high street restaurant chains restructuring their portfolios.

Staff costs and lower footfall have been blamed for the demise of restaurant chains along with a fall in the value of the pound, which has ramped up the cost of buying ingredients.

The struggling high street restaurant chains

Byron Burger – former star player is closing 12 branches, is £71.5million in debt and can’t confirm its plan to open in Plymouth’s Drake Circus Leisure multiplex.

Frankie & Benny’s/Chiquito – owner the Restaurant Group (which also owns Garfunkel’s, Brunning and Price, Coast to Coast and Joe’s Kitchen) is considering selling some prime sites and “exploring options” for other restaurants in its estate. Plymouth has Frankie & Benny’s and Chiquito at Barbican Leisure Park.

Prezzo – is closing 94 of its 300 restaurants, but Plymouth’s Royal William Yard branch will survive.

Jamie’s Italian – chain owned by celebrity chef Jamie Oliver has entered a company voluntary agreement (CVA) and will shut 12 restaurants, after facing pre-tax losses of £9.9million in 2016.

All Bar One/Toby Carvery – owner Mitchells and Butlers blamed economic and political uncertainty for its decision to cancel its next dividend in late 2017. Industry experts say All Bar One has been slashing prices. There is a Toby Carvery at Roborough, Plymouth.

Nando’s – the chain with Plymouth branches at Old Town Street and Barbican Leisure Park reported an increase in revenue and gross profit in the year to February 2017.

Wagamama – the Asian food chain, with a large unit at Royal William Yard and confirmed plans to open at Bretonside’s Drake Circus Leisure multiplex, saw profit after tax, staff and restaurant numbers grow in the year to April 2017.

Zizzi – the chain, another confirmed for Drake Circus Leisure, recorded a 12.5 per cent increase in sales to £262.8million for the year to July 2107, though has been accused by some observers of fueling this by discounting prices and Deliveroo sales eating into restaurant turnover.

Soaring business rates, National Living Wage costs and the Apprenticeship Levy have also been said to have taken their toll.

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The Restaurant Group has already closed more than 40 sites around the UK over the past two years. Its shares have plummeted almost 30% in the past year. Analysts have predicted full-year revenues will fall to £669 million from £710.7 million in 2016. It’s expected that pre-tax profits will take a £20 million dip to £57 million.

Figures from KPMG found that 25% of companies in the casual dining sector booked an operating loss at least once in the past six months.

Partner Will Wright said cash-squeezed consumers are overloaded with options of where to eat and are now tending to choose “alternative ‘experiential’ dining experiences” over “familiar fare”.

The owners of Italian American style diners Frankie & Benny's and Chiquito are looking to close some restaurants

Mr Wright is the latest expert to predict a difficult future for the casual dining chains.

Many restaurants are struggling due to a combination of factors including rising costs and falling consumer spending.

Robert Scott-Moncrieff, equity analyst at leading wealth manager Brewin Dolphin, which has a base in Truro, said the overabundance of outlets is causing a major problem, with cities such as Cornwall's capital or popular seaside resorts like Newquay being swamped with restaurants.

He said the ones that are already in trouble could be just “the tip of the iceberg”.

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Accountancy firm Deloitte said like-for-like sales growth in British restaurants fell in the 18 months from December 2015 and was slower than cost inflation.

He said: "We certainly anticipate this wave of restructuring to continue over the months ahead, as stakeholders take measures to ‘right size’ their estates to a more profitable core, with the ultimate aim of safeguarding their long-term futures."

Cornwall's Prezzo restaurants will be closed by the end of next month (Image: TripAdvisor)

KPMG analysed 125 casual dining companies with revenues of £15million or more and found 78% of industry players had seen their net debt swell in the past two quarters.

Of those that added to their debt pile, a fifth saw a decrease in their cash balance.

Margins were also coming under pressure, with 69 per cent of firms working with operating margins of under five per cent.

Mr Wright added: "With profit margins being squeezed and debt burdens increasing, and all economic indicators pointing to signs that things aren’t going to improve soon, restaurant businesses are looking for cost cutting measures through operational and financial restructuring, including negotiations with lessors and in some cases, considering the need for a CVA.

However he insisted it might work out in the long term adding: "I firmly believe the long-term future of casual dining remains bright, particularly for those operators who are able to stay relevant and who place the customer experience at the heart of their business."